Investing.com -- The recent Bitcoin rally has pushed many investors into a bullish frenzy, but BCA Research believes now is a good time to step back.

BCA analyst Juan Correa, a known crypto bull, has been urging investors to embrace Bitcoin since early 2023, when the broader market was largely skeptical about the world’s largest cryptocurrency.

Since then, Bitcoin price has quadrupled, institutional interest has surged, and pension funds have begun considering allocations. However, Korea believes now is not the right time to enter the market.

“The surge in memecoins, record-breaking Bitcoin ETF inflows, and retail speculation suggest excess optimism, historically a warning signal,” Juan Correa said in a Monday report.

They point to a deteriorating macro backdrop as another reason for caution, citing factors such as “less fiscal policy than expected, moderating growth, and declining inflation,” which could also create a less favorable environment for crypto in the following months.

“We remain structurally positive on Bitcoin and believe that it has a place in a multi-asset portfolio,” strategists continued.

“With that said, sentiment matters and even the best asset cannot be bought at any price. Thus, we believe we are at a point where it is prudent to begin cashing out on gains and holding off on any incremental allocations.”

BCA is prepared to re-enter the market but at lower levels, identifying $75,000 as an appealing entry point.

One of the biggest indicators of excessive speculation is the explosion of memecoins, a phenomenon BCA highlights through the launch of Trump’s $TRUMP coin and its subsequent collapse following the introduction of $MELANIA .

The firm also notes that Bitcoin ETFs have seen unprecedented inflows, breaking historical records, while crypto trading apps dominate download charts.

On the macro side, growth forecasts are at their highest levels since 2022, while inflation expectations have risen to 16-year highs. Moreover, BCA suggests that the US fiscal trajectory could disappoint expectations, which may weigh on risk assets, including crypto.

The firm acknowledges two potential risks to its bearish stance—Trump’s proposed Strategic Bitcoin Reserve and a new paradigm where memecoins become mainstream financing tools.

“A world where financial guardrails have been completely abandoned and everyone with a few social media followers can raise billions of dollars at will,” BCA explains.

Nonetheless, for now, BCA believes Bitcoin has reached a near-term top and advises investors to wait for better entry opportunities.